Indonesian MSMEs, the country’s economic backbone, scramble to maintain productivity and survive during these unprecedented circumstances. They make every attempt to survive but they require support.

“A number of companies strive to diversify their products, while others shift their businesses online. These businesses need support in adapting their business models and operations ‘after COVID-19’,” said Januar Rustandie, Project Manager of the ILO’s Sustaining Competitive and Responsible Enterprises (SCORE) Programme in Indonesia.

Considering the importance of support and assistance for the Indonesian MSMEs, the ILO’s SCORE programme sought to minimize the impact of COVID-19 on micro enterprises through marketplace and social media online training sessions, in cooperation with its long-time training partner, the Business and Export Development Organization (BEDO).

Around 40 MSMEs, located in several regions of Java, Bali and Lombok, participated in the programme carried out for three months from April to June 2020 via virtual platforms. These participating enterprises had previously participated in ILO SCORE Training to improve productivity and working conditions. They were not only familiar with the training methods, but also acquainted with the organization, motivating BEDO to proceed with the programme.

Three out of four participating MSMEs had recorded a 30 to 90 percent decrease in sales at the start of the pandemic. Godho Batik in Banyuwangi, East Java, one of the participating enterprises specializing in custom-made attire, for example, recorded a drastic fall in revenues from Rp 65 million (US$ 4,643) to Rp 9 million (US$ 643) due to a decreasing number of orders.

To help these enterprises survive, the ILO’s SCORE programme and BEDO provided one-on-one business coaching and consultation via text messages or phone calls. These direct consultations allowed the participating MSMEs to quickly change their way of doing business to survive the recession.

“One-on-one consultations allowed trainers to attend to the specific challenges faced by each MSME and provide relevant inputs that could be applied to their respective products,” said Project Manager Januar Rustandie.

Seventeen ILO SCORE trainers were involved in these one-on-one consultations, dealing with topics ranging from product innovation and market segmentation, cost of goods sold and bookkeeping to hygiene and occupational safety and health, cooperation and information sharing. The session also covered online marketing and appealing product photography.

Taking into account the growing needs of digital marketing, the training programme also provided online classes on how to make the best use of social media to boost sales and extend markets. Only 35 percent of the participating MSMEs had conducted online marketing, while the remaining participants had not seriously paid attention or had not done it at all.

At the end of the training, 87 percent of the participating MSMEs had recorded turnover increase between 100 to 600 percent and 23 percent had increased their number of employees. The application of digital marketing had also helped the enterprises to gain new customers, potential new customers and market extension by 21 percent.

One enterprise that increased revenues is Akar Jawi, an enterprise specializing in herbal products from Rembang, Central Java. Ummi Salamah, owner of Akar Jawi, testified that her company had recorded a drastic increase from Rp 3 million (US$ 215) to nearly Rp 20 million (US$ 1,430) due to an increasing demand for herbal products.

Meanwhile, Popatoy, an enterprise that produces educational toys in Malang, East Java, witnessed an increase in its turnover after shifting to online marketing. Anisa Aprilia, owner of the Popatoy, said that her company enjoyed a double increase from Rp 8 million (US$ 571) to Rp 16 million (US$ 1,143). She even added two more employees and increased her number of resellers from 15 to 18 people.

“Based on SCORE Training, we learnt that we need to address the vast topics around marketing, including appropriate adjustments for customers amid the pandemic, product selection and a marketing strategy that is adaptive to the unprecedented times,” concludes Januar Rustandie.